So why are people apparently so anxious to define economic problems as issues of international competition? The competitive metaphor--the image of countries competing with one another in world markets in the same way that corporations do--derives much of its attractiveness from its seeming comprehensibility. Tell a group of businessmen that a country is like a corporation writ large, and you give them the comfort of feeling that they already understand the basics. Try to tell them about economic concepts like comparative advantage, and you are asking them to learn something new. It should not be surprising if many prefer a doctrine that offers the gain of apparent sophistication without the pain of hard thinking. The rhetoric of competitiveness has become so prevalent, however, for three deeper reasons.
First, competitive images are exciting, and thrills sell tickets. The subtitle of Lester Thurow's bestseller, Head to Head, is "The Coming Economic Battle Among Japan, Europe, and America"; the jacket proclaims that the "decisive war of the century is being waged right now . . . and we may have already decided to lose." Suppose the subtitle had described the real situation: "The coming struggle in which each big economy will succeed or fail based on its own efforts, pretty much independently of how well the others do." Would Thurow have sold a tenth as many books?
Second, the idea that U.S. economic difficulties hinge crucially on our failures in international competition makes those difficulties seem easier to solve. The productivity of the average American worker is determined by a complex array of factors, most of them out of reach of any likely government policy. So if you accept the reality that our "competitive" problem is really a domestic productivity problem pure and simple, you are unlikely to be optimistic about any dramatic turnaround. But if you can convince yourself that the problem is really one of failures in international competition--that imports are pushing workers out of high-wage jobs, or that subsidized foreign competition is driving the United States out of the high value-added sectors--then the answers to economic malaise may seem to you to involve simple things like subsidizing high technology and being tough on Japan.
Finally, many of the world's leaders have found the competitive metaphor extremely useful as a political device. The rhetoric of competitiveness turns out to provide a good way either to justify hard choices or to avoid them. For example, the well-received presentation of Bill Clinton's initial economic program in February 1993 showed the usefulness of competitive rhetoric as a motivation for tough policies. Clinton used this language when he proposed a set of painful spending cuts and tax increases to reduce the federal deficit. Why? The real reasons for cutting the deficit are disappointingly undramatic: the deficit siphons off funds that might otherwise have been productively invested, and thereby exerts a steady if small drag on U.S. economic growth. But Clinton was able instead to offer a stirring patriotic appeal, calling on the nation to act now in order to make the economy competitive in the global market--with the implication that dire economic consequences would follow if we do not.
Some economists think that this sort of political payoff justifies the emphasis on competitiveness. They argue that although the rhetoric that portrays world trade as a high-stakes competition is false, it is a noble lie that helps our leaders persuade the public to do what needs to be done. But I believe that this indulgent view is not only deeply cynical but harmful.